Reading between the lines of the HLI Compromise Agreement
By: Butch S. Espere (SENTRA Research)
By: Butch S. Espere (SENTRA Research)
Framework and Trajectory of the HLI Compromise Agreement (CA) signed August 6:
1. HLI’s main framework in the CA is how to ram down its retention of ownership and control of the lands through maintenance of the SDO. This framework can be traced back to 1957 when they agreed to a “social justice conditionality” of the sovereign guarantee extended by the government to Tadeco to enable the company to obtain a P 9.6 million loan from the Chase Manhattan Bank only to renege on it when demanded by the government and FWs of its compliance. Then there was Cory’s promise when she was on the campaign trail in the 1986 election that Hacienda Luisita would be the first to go if she captured the presidency from Marcos only to make a 180-degree turn by signing EO 229 which allowed the SDO.
This chapter of the narrative of the HLI is such that the Cojuangcos-Aquinos have to invent and reinvent the fiction that they are willing to give up the HLI lands but it is the farm workers (FWs) who want the SDO. This explains why the “voluntarily” contracted nature of the SDO is very vital to their defense of HLI lands. To maintain that fiction of “voluntariness”, the consent of the FWs has to be manufactured again and again. In a word, the Cojuangcos-Aquinos are not only exploiting the FWs by squeezing them of their labors, they are also using the FWs as shield or road block against land distribution.
2. To justify this framework, the CA says nothing about the issues that caused the FWs to go on strike in 2004 demanding for the dissolution of the SDO. This silence is pregnant with assumptions that shamelessly disregarded the realities shaping in HLI during the more than twenty years of SDO implementation. The way it was worded, the CA made it appear that the 2004 FWs strike which claimed the lives of 7 FWs and the injury of hundreds never did happen. This omission is crucial because the 2004 FWs strike amounted to the most effective, most vehement form of renouncing the 1989 MOA which mothered the SDO. The strike was akin to FWs tearing down the 1989 MOA in public. It also made it appear that the 2006 PARC Report setting out in detail the failure of SDO to improve the lives of the FWs did not exist. This is to lay down the argument that all is well in the HLI; and that all the trouble in paradise was due to “outsiders” who needlessly meddled in the hacienda affairs.
3. Although unwritten in the CA, it is all over in the document that HLI and the Cojuangcos-Aquinos are clinging to their defense when the SDO issue exploded on their face in 2004. To recall, these defenses are:
• Defense no. 1: That the SDO was okay and fine; that, in the parlance of con men and HLI's own spokesmen (during the congressional hearing), “it’s the best there is”.
To prove this, HLI defenders would rattle off mind boggling figures on the alleged benefits that FWs enjoy under the SDO such as stock shares, production share, housing, medical benefits, etc., etc. But this is weaving cobwebs in the dark world of SDO. To clear this world of cobwebs and throw some light on it, we must realize that the FWs in HLI straddle the two conflicting spheres of being workers and stock holders. The bulk of these vaunted benefits actually fall under the category of workers’ benefits, not as SDO benefits. The medical benefits, for example, are standard fare to workers. Production share is also enjoyed by workers in other companies not under the SDO. Under the SDO, stock share is the only benefit of the FWs and, we may add, the empty title that they are per diviso owners of the corporation (a benefit which you can’t serve on the dining table).
Second, those benefits when mentioned in their totality can boggle the mind as they run in millions. For example, the totality of the stock shares to be distributed, equivalent to 33 per cent of the total stocks, runs up to P118 million. But when reduced to per capita, on the base factor of more than 12,000 FWs, the amount shrinks to a morsel each worker. And the morsel is getting smaller because the share is based on man-hours. No man-hours, no shares - which makes the scheme closely similar to production share. Contrast that with the condition of land ownership: the farmer owns the land and gets his full share of the product even if he chooses not to work for a day.
Third, in real time, the benefits of the SDO are to be enjoyed by the FWs only upon the completion of the 30 year-period of distribution. For now, what they get are certificates which can not buy a loaf of bread. Simply put, those mind-boggling figures are actually hollow when measured against real benefits (benefits that the FWs can take home and use for their present real needs).
• Defense no. 2: Even the best schemes can have kinks. But being in the nature of contract (the 1989 MOA between Tadeco, HLI and the FWs), whatever problems the SDO might have, the remedy is for the parties to talk.
This is a complicated defense and, to HLI defenders, this is their armor, their last line of defense. Should defense number 1, which is fragile in the face of the PARC Report which sets out in detail the failure of SDO as an agrarian reform scheme, falls, this is the trench to where they would step back and put up their last stand. It proceeds from the argument that what happened in HLI is an “intra-corporate controversy” (the words in quote marks are not mine but of PNoy); that such “intra-corporate controversy” merely involves the interpretation of the contract between the HLI and the FWs and, thus, should be better left to the parties to resolve. What makes this defense assume the form of armor is that it excludes all the rest who are not parties to the contract: the PARC (together with its damning report on the SDO), DAR, even the Supreme Court and the entire government, KMP, UMA, SENTRA, and all those Leftists who came to the aid of the FWs.
4. This is the essence of the first five “whereases” of the CA signed last Friday (August 6). They articulate the HLI’s attempt to delimit all talks within the parameters of the contract by doggedly clinging to the 1989 MOA as if saying “may napagkasunduan tayo kaya mag-usap tayo kung mayroon mang problema”. More than that, the first five “whereases” which recall the terms of the 1989 MOA would be their shield for fending off accusations that they committed violations of the contract, again as if saying to the FWs: “tingnan nyo, ito lang naman yung napagkasunduan natin, may violation ba kami dyan? Wala, dahil we delivered our end of the bargain as written in the contract”. To recall, the 1989 MOA did not speak about improving the lives of farmers; it did not speak about distributing shares that should be of such value that could enable the FWs to eat three times a day, send their children to school, or buy medicine for their sick; it did not speak about strengthening the security of tenure of the FWs. It merely spoke of complying with the requirements for implementing alternatives to land distribution under CARP through the distribution of P118,377,755 worth of shares to FWs, the allocation home lots of 240 square meters sq. meters to the FWs, and the provision of production share of 3 per cent of the total gross sales. Nothing more. So where are the violations?
5. Thus, the CA tried to establish in its first five “whereases” that there is no basis in the act of the FWs seeking the revocation of the SDO. And there being no basis, the contract “remains effective and valid” (9th whereas). That the FWs’ resort to strike and their petitioning for the revocation of the SDO were merely the result of having been misguided by meddling Leftists; that if the parties would only talk between and among themselves, a compromise agreement could be reached that could pave the way for the early resolution of the case (10th whereas).
6. The last “whereas” actually hammers down the nail on the coffin for the FWs claim to the land, coffin which the HLI insists on calling “compromise agreement”. It speaks of “early resolution” of the issues and of the parties coming to a “compromise agreement” which actually prefaced the terms (as can be found in Sections 4, 5, 6, 7 and 8) for the surrender of the struggle of the FWs, including their right to pursue their struggle and other stake claims should the CA turn out to be an old dog with a new fang. This surrender is to be achieved by a term in the CA (Section 3) that dangles a P150 million “financial assistance package” to the FWs, a package which is actually meant to bribe the FWs who have been without work and income since 2004 when HLI opted to close operation rather than give in to the demands of the FWs.
On the other hand, it strengthens HLI’s armor of protection from any action, be it present or in the future, that would assail the contract or the SDO while affirming, thereby reinforcing, the contractual nature of the 1989 MOA and of the CA itself with all their element of “voluntariness” on the part of the contracting parties. The first is done through a provision wherein the FWs waive their rights to any claim under the SDO or their employment.
7. The CA being now clothed with the “sacred voluntariness” of the contracting parties, HLI can now tell the SC, DAR and PARC that “you are out of this”; that the controversy has become moot and the only thing that remains for these bodies to do is to “stamp pad” the contract.
8. A little correction. We have mentioned that the CA was deafeningly silent on the issues that caused the FWs to strike and seek revocation of the SDO. Well, in Term nos. 1 and 2 of the CA, it does give the FWs the right to choose between SDO or land. The HLI will make much capital of this “concession”.
But this “concession” not only short changed the FWs since only 1/3 of the total agricultural lands, or 1,300 hectares, will be put up for land distribution. Such fragment of the HLI agricultural lands would mean that FWs who opt for land will only get such size that is not economically viable; it is actually meant to discourage FWs to opt for land distribution. It ensures that only a limited number of FWs can choose land even if they could transcend the discouragement. It also ensures that those who opt for land will fail so as to vindicate them who say that the only way for the lands to remain productive is the hacienda way. The size not being economically viable or sustainable, the tendency is for the FWs to sell their lands. So a term (Term No. 5) was put in place which gives HLI the right of first refusal as a door for getting back the land. It is also meant to slam the door on future claims to the land by FWs. Those who opt for the SDO under the CA can no longer withdraw from it (Term no. 7) and opt for land.
1. HLI’s main framework in the CA is how to ram down its retention of ownership and control of the lands through maintenance of the SDO. This framework can be traced back to 1957 when they agreed to a “social justice conditionality” of the sovereign guarantee extended by the government to Tadeco to enable the company to obtain a P 9.6 million loan from the Chase Manhattan Bank only to renege on it when demanded by the government and FWs of its compliance. Then there was Cory’s promise when she was on the campaign trail in the 1986 election that Hacienda Luisita would be the first to go if she captured the presidency from Marcos only to make a 180-degree turn by signing EO 229 which allowed the SDO.
This chapter of the narrative of the HLI is such that the Cojuangcos-Aquinos have to invent and reinvent the fiction that they are willing to give up the HLI lands but it is the farm workers (FWs) who want the SDO. This explains why the “voluntarily” contracted nature of the SDO is very vital to their defense of HLI lands. To maintain that fiction of “voluntariness”, the consent of the FWs has to be manufactured again and again. In a word, the Cojuangcos-Aquinos are not only exploiting the FWs by squeezing them of their labors, they are also using the FWs as shield or road block against land distribution.
2. To justify this framework, the CA says nothing about the issues that caused the FWs to go on strike in 2004 demanding for the dissolution of the SDO. This silence is pregnant with assumptions that shamelessly disregarded the realities shaping in HLI during the more than twenty years of SDO implementation. The way it was worded, the CA made it appear that the 2004 FWs strike which claimed the lives of 7 FWs and the injury of hundreds never did happen. This omission is crucial because the 2004 FWs strike amounted to the most effective, most vehement form of renouncing the 1989 MOA which mothered the SDO. The strike was akin to FWs tearing down the 1989 MOA in public. It also made it appear that the 2006 PARC Report setting out in detail the failure of SDO to improve the lives of the FWs did not exist. This is to lay down the argument that all is well in the HLI; and that all the trouble in paradise was due to “outsiders” who needlessly meddled in the hacienda affairs.
3. Although unwritten in the CA, it is all over in the document that HLI and the Cojuangcos-Aquinos are clinging to their defense when the SDO issue exploded on their face in 2004. To recall, these defenses are:
• Defense no. 1: That the SDO was okay and fine; that, in the parlance of con men and HLI's own spokesmen (during the congressional hearing), “it’s the best there is”.
To prove this, HLI defenders would rattle off mind boggling figures on the alleged benefits that FWs enjoy under the SDO such as stock shares, production share, housing, medical benefits, etc., etc. But this is weaving cobwebs in the dark world of SDO. To clear this world of cobwebs and throw some light on it, we must realize that the FWs in HLI straddle the two conflicting spheres of being workers and stock holders. The bulk of these vaunted benefits actually fall under the category of workers’ benefits, not as SDO benefits. The medical benefits, for example, are standard fare to workers. Production share is also enjoyed by workers in other companies not under the SDO. Under the SDO, stock share is the only benefit of the FWs and, we may add, the empty title that they are per diviso owners of the corporation (a benefit which you can’t serve on the dining table).
Second, those benefits when mentioned in their totality can boggle the mind as they run in millions. For example, the totality of the stock shares to be distributed, equivalent to 33 per cent of the total stocks, runs up to P118 million. But when reduced to per capita, on the base factor of more than 12,000 FWs, the amount shrinks to a morsel each worker. And the morsel is getting smaller because the share is based on man-hours. No man-hours, no shares - which makes the scheme closely similar to production share. Contrast that with the condition of land ownership: the farmer owns the land and gets his full share of the product even if he chooses not to work for a day.
Third, in real time, the benefits of the SDO are to be enjoyed by the FWs only upon the completion of the 30 year-period of distribution. For now, what they get are certificates which can not buy a loaf of bread. Simply put, those mind-boggling figures are actually hollow when measured against real benefits (benefits that the FWs can take home and use for their present real needs).
• Defense no. 2: Even the best schemes can have kinks. But being in the nature of contract (the 1989 MOA between Tadeco, HLI and the FWs), whatever problems the SDO might have, the remedy is for the parties to talk.
This is a complicated defense and, to HLI defenders, this is their armor, their last line of defense. Should defense number 1, which is fragile in the face of the PARC Report which sets out in detail the failure of SDO as an agrarian reform scheme, falls, this is the trench to where they would step back and put up their last stand. It proceeds from the argument that what happened in HLI is an “intra-corporate controversy” (the words in quote marks are not mine but of PNoy); that such “intra-corporate controversy” merely involves the interpretation of the contract between the HLI and the FWs and, thus, should be better left to the parties to resolve. What makes this defense assume the form of armor is that it excludes all the rest who are not parties to the contract: the PARC (together with its damning report on the SDO), DAR, even the Supreme Court and the entire government, KMP, UMA, SENTRA, and all those Leftists who came to the aid of the FWs.
4. This is the essence of the first five “whereases” of the CA signed last Friday (August 6). They articulate the HLI’s attempt to delimit all talks within the parameters of the contract by doggedly clinging to the 1989 MOA as if saying “may napagkasunduan tayo kaya mag-usap tayo kung mayroon mang problema”. More than that, the first five “whereases” which recall the terms of the 1989 MOA would be their shield for fending off accusations that they committed violations of the contract, again as if saying to the FWs: “tingnan nyo, ito lang naman yung napagkasunduan natin, may violation ba kami dyan? Wala, dahil we delivered our end of the bargain as written in the contract”. To recall, the 1989 MOA did not speak about improving the lives of farmers; it did not speak about distributing shares that should be of such value that could enable the FWs to eat three times a day, send their children to school, or buy medicine for their sick; it did not speak about strengthening the security of tenure of the FWs. It merely spoke of complying with the requirements for implementing alternatives to land distribution under CARP through the distribution of P118,377,755 worth of shares to FWs, the allocation home lots of 240 square meters sq. meters to the FWs, and the provision of production share of 3 per cent of the total gross sales. Nothing more. So where are the violations?
5. Thus, the CA tried to establish in its first five “whereases” that there is no basis in the act of the FWs seeking the revocation of the SDO. And there being no basis, the contract “remains effective and valid” (9th whereas). That the FWs’ resort to strike and their petitioning for the revocation of the SDO were merely the result of having been misguided by meddling Leftists; that if the parties would only talk between and among themselves, a compromise agreement could be reached that could pave the way for the early resolution of the case (10th whereas).
6. The last “whereas” actually hammers down the nail on the coffin for the FWs claim to the land, coffin which the HLI insists on calling “compromise agreement”. It speaks of “early resolution” of the issues and of the parties coming to a “compromise agreement” which actually prefaced the terms (as can be found in Sections 4, 5, 6, 7 and 8) for the surrender of the struggle of the FWs, including their right to pursue their struggle and other stake claims should the CA turn out to be an old dog with a new fang. This surrender is to be achieved by a term in the CA (Section 3) that dangles a P150 million “financial assistance package” to the FWs, a package which is actually meant to bribe the FWs who have been without work and income since 2004 when HLI opted to close operation rather than give in to the demands of the FWs.
On the other hand, it strengthens HLI’s armor of protection from any action, be it present or in the future, that would assail the contract or the SDO while affirming, thereby reinforcing, the contractual nature of the 1989 MOA and of the CA itself with all their element of “voluntariness” on the part of the contracting parties. The first is done through a provision wherein the FWs waive their rights to any claim under the SDO or their employment.
7. The CA being now clothed with the “sacred voluntariness” of the contracting parties, HLI can now tell the SC, DAR and PARC that “you are out of this”; that the controversy has become moot and the only thing that remains for these bodies to do is to “stamp pad” the contract.
8. A little correction. We have mentioned that the CA was deafeningly silent on the issues that caused the FWs to strike and seek revocation of the SDO. Well, in Term nos. 1 and 2 of the CA, it does give the FWs the right to choose between SDO or land. The HLI will make much capital of this “concession”.
But this “concession” not only short changed the FWs since only 1/3 of the total agricultural lands, or 1,300 hectares, will be put up for land distribution. Such fragment of the HLI agricultural lands would mean that FWs who opt for land will only get such size that is not economically viable; it is actually meant to discourage FWs to opt for land distribution. It ensures that only a limited number of FWs can choose land even if they could transcend the discouragement. It also ensures that those who opt for land will fail so as to vindicate them who say that the only way for the lands to remain productive is the hacienda way. The size not being economically viable or sustainable, the tendency is for the FWs to sell their lands. So a term (Term No. 5) was put in place which gives HLI the right of first refusal as a door for getting back the land. It is also meant to slam the door on future claims to the land by FWs. Those who opt for the SDO under the CA can no longer withdraw from it (Term no. 7) and opt for land.
